How can bid-ask-scalping algos be profitable?

[Philly_UK]

There are algorithms that aim to spoof the market and then take the smallest possible profit of 1 tick by buying at the bid and selling at the ask. This strategy cannot be profitable in my view as it is practically impossible to avoid situations where the inside market (bid/ask) moves immediately against the algo's position. How do they handle that? Risk-reward ratio here is terrible.
The other issue is the effectiveness of spoofing itself - I could understand it has some use when it is noticeable by human beings. However, if the spoofing orders are placed for milliseconds and then cancelled, who do they deceive? Conflicting thoughts come to my mind on this matter, since spoofing is banned. That surely means it must be profitable (logically thinking - if something is considered illegal, then it must make money). But how? I would be grateful for your opinions about this issue.

 

[tar]

And sometimes it moves in their favor , unlike us they end up earning the spread rather than paying it ...

 

[Philly_UK]

And sometimes it moves in their favor , unlike us they end up earning the spread rather than paying it ...

Of course, but "sometimes" does not mean frequently enough to have positive expectancy of such a strategy

 

[tar]

impossible to avoid situations where the inside market (bid/ask)moves immediately against the algo's position..

Ofcourse but "situations" doesn't mean frequently enough to have negative expectancy of such strategy .

 

[DionysusToast]

I know a guy that scalps crude for 1 tick - sometimes a bit more.

It's not a matter of getting in at any bid/offer level hoping for a fill on both sides.

You need an awareness of market state and then you need an opportunity based on the state of the market.

So if the market is directional you need to take opportunities to make that scalp on one side of the market. If the market is not directional, then you can go both ways but you still need to see specific things first.

For example, if no-one is hitting the bids, then you don't join the offer.

You'll miss a lot of trades but basically you are effectively joining the bid/offer at a place where really no-one with half a brain should hit into it - but they do anyway.